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Comparison of economic instruments to reduce PM2.5 from industrial and residential sources

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  • Mardones, Cristian
  • Saavedra, Andrés

Abstract

In the literature, it is possible to find different studies that compare economic instruments performance applied to the industrial sources regulation; however, evidence about pollution from residential sources is scarce. For this reason, the present study simulates and compares an emission permit system (EPS) and an ambient permit system (APS) when fine particulate matter pollution (PM2.5) is generated from industrial and residential sources. Thus, this research contributes to the spatial, economic and environmental assessment of industrial and residential emissions. The options to reduce pollution include replacement of heating devices in residential sources and installing end-of-pipe technologies in industrial sources. The results in terms of total cost and technological chosen options are similar under an APS and EPS for targets lesser to 80%. This is explained because it is more cost-effective to reduce emissions in residential sources than in industrial sources, and additionally, residential pollution has only local impact. However, some industrial sources should install abatement technologies for more demanding targets; in this case as industrial pollution are scattered in different areas, the total cost of an APS are lower than the total cost of an EPS.

Suggested Citation

  • Mardones, Cristian & Saavedra, Andrés, 2016. "Comparison of economic instruments to reduce PM2.5 from industrial and residential sources," Energy Policy, Elsevier, vol. 98(C), pages 443-452.
    • Handle: RePEc:eee:enepol:v:98:y:2016:i:c:p:443-452
    DOI: 10.1016/j.enpol.2016.09.011
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    References listed on IDEAS

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    1. Stavins, Robert N., 2003. "Experience with market-based environmental policy instruments," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 1, chapter 9, pages 355-435, Elsevier.
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    3. Raúl O’Ryan, 2006. "Factors that determine the cost-effectiveness ranking of second-best instruments for environmental regulation," Journal of Regulatory Economics, Springer, vol. 30(2), pages 179-198, August.
    4. Schueftan, Alejandra & González, Alejandro D., 2013. "Reduction of firewood consumption by households in south-central Chile associated with energy efficiency programs," Energy Policy, Elsevier, vol. 63(C), pages 823-832.
    5. Ponce, Roberto & Chávez, Carlos, 2005. "Costos de cumplimiento de un sistema de permisos de emisión. Aplicación a fuentes fijas en Talcahuano, Chile," El Trimestre Económico, Fondo de Cultura Económica, vol. 0(288), pages 847-876, octubre-d.
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    Cited by:

    1. Mardones, Cristian & Cabello, Martin, 2019. "Effectiveness of local air pollution and GHG taxes: The case of Chilean industrial sources," Energy Economics, Elsevier, vol. 83(C), pages 491-500.
    2. Mardones, Cristian, 2021. "Ex-post evaluation and cost-benefit analysis of a heater replacement program implemented in southern Chile," Energy, Elsevier, vol. 227(C).
    3. Mardones, Cristian, 2024. "Measuring the efficiency gains of merging carbon markets – A microsimulation for thermoelectric and industrial sources," Energy, Elsevier, vol. 290(C).
    4. Becerra, Miguel & Jerez, Alejandro & Valenzuela, Miguel & Garcés, Hugo O. & Demarco, Rodrigo, 2018. "Life quality disparity: Analysis of indoor comfort gaps for Chilean households," Energy Policy, Elsevier, vol. 121(C), pages 190-201.
    5. Mardones, Cristian & Flores, Belén, 2018. "Effectiveness of a CO2 tax on industrial emissions," Energy Economics, Elsevier, vol. 71(C), pages 370-382.
    6. Cristian Mardones, 2021. "Analysis on complementarity between a CO2 tax and an emissions trading system to reduce industrial emissions in Chile," Energy & Environment, , vol. 32(5), pages 820-833, August.

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    Keywords

    PM2.5; Emission tradable system; Ambient permit system;
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